Is NEMT a good business? What the work pays, what it demands, and who does well

NEMT pairs steady demand with slim margins. The demand comes from a federal rule, so it does not depend on advertising or on riders’ ability to pay. The margin is thin because the payer usually sets your price, and your two biggest costs, drivers and insurance, run whether or not the van is full. Whether it is a good business for you comes down to how many trips each van completes per hour and how many payers you depend on.

Why the demand holds up

The demand rests on law. Under 42 CFR 431.53, each state’s Medicaid plan has to make sure members can get to covered services and home again, and Congress wrote that duty into the Social Security Act in December 2020. Without federal approval, a state cannot drop rides for members who have no other way to reach care.

CMS’s 2023 report to Congress counted about 3.3 million Medicaid members who used NEMT in 2021, on 55.5 million ride days. That was below 2019, when about 3.9 million members rode on 81.3 million ride days, partly because the pandemic moved some visits to telehealth. CMS notes both figures undercount, since some states do not report all rides in the national data.

Use is concentrated in people with ongoing care. Fewer than 4 percent of all Medicaid members used NEMT in 2021, but some groups rode far more often:

Three trends support that base:

• Dialysis. More than 808,000 Americans live with kidney failure, and 68 percent of them are on dialysis, according to NIDDK. At the end of 2021, only 14.1 percent of dialysis patients dialyzed at home. A center schedule is three treatments a week of about four hours each, so a single rider can account for six trip legs a week. Our guide to dialysis transportation contracts covers how to win that work.
• An older population. In the Census Bureau’s 2023 projections, adults 65 and older become a larger share of the population than children under 18 in 2029.
• Few other payers. Medicare and private insurers generally pay for emergency transport and leave NEMT out, CMS notes, so Medicaid carries most of this work. See who pays for NEMT.

Why the margin is thin

In most NEMT work you do not set your price. A state fee schedule or a broker contract does. Georgia’s NEMT manual shows how the money flows in a broker state. The broker receives a set sum each month for every eligible member in its region, and that one payment must pay for the rides plus the broker’s own costs and margin. The broker’s payments to ride companies come from that same sum, trip by trip, at the rates in each agreement.

Kentucky’s 2026 law (House Bill 2) puts a number on the broker’s share. Its regional brokers are paid per eligible member. From July 2026, each must reach an 85 percent medical loss ratio, a floor that climbs a step a year until it hits 90 percent in July 2029, or return the excess to the state. In plain terms, most of the money has to reach services, and your trip rate is paid out of that share.

CMS’s Medicaid Transportation Coverage Guide adds three federal rules that shrink what you can bill:

• Miles with no rider aboard usually earn nothing, even the return leg after a no-show. A state may fold that cost into its rates. See deadhead miles.
• Payers buy the cheapest mode that suits the rider. A trip booked as ambulatory cannot be billed at the wheelchair rate.
• A trip your company misses earns nothing, because no service was delivered.

Published rates show the scale. Ohio’s Medicaid schedule, in the version enacted July 10, 2026, pays a wheelchair van a base rate of up to $31.00 and $1.30 for each mile. An attendant adds $15.00. An eight-mile wheelchair trip there pays up to $41.40. Rates vary widely by state, so check yours in how much Medicaid pays for NEMT.

Drivers and insurance come first

Drivers are the cost you feel every hour. In the May 2025 federal wage survey, shuttle drivers and chauffeurs earned $17.93 an hour at the national median, and the middle half made $15.73 to $21.97. Employer payroll taxes add 7.65 percent (6.2 for Social Security, 1.45 for Medicare), which brings a median driver to about $19.30 an hour. Unemployment insurance, workers’ comp premiums, and any benefits come on top. You pay all of it during clinic waits and empty drives too.

Insurance is the cost you pay before the first trip. Each broker writes minimum coverage into its provider agreement. The MTM contract that Pennsylvania’s human services department publishes, dated January 1, 2023, sets these floors:

The same agreement lets MTM raise those limits, and your policies must list MTM as an additional insured. Your premium depends on your vehicles, drivers, state, and claims history, so get real quotes before you commit. See NEMT insurance cost. The accessible van itself, bought or leased, is a separate line, and NEMT startup costs breaks it down.

What one van has to earn per hour

The cleanest way to judge the business is per van-hour. This hypothetical example uses the Ohio wheelchair rate above, eight loaded miles and five empty miles per trip, a median-wage driver at $19.30 an hour, and 76 cents a mile, the IRS business mileage rate that took effect July 1, 2026, to stand in for fuel, upkeep, and vehicle cost.

Each trip brings in $41.40 and costs $9.88 in vehicle miles, leaving $31.52 to pay the driver and everything else.

The “left” column still has to cover insurance, dispatch, billing, phones, software, and the owner. At these numbers the van breaks even on driver and miles at about 0.6 trips per hour, and every trip above that is where the business lives. The IRS rate is a general business-driving figure, not the true cost of a lift van, so swap in your real costs. When the owner drives, the driver line drops out and one trip per hour leaves about $284 a day. Run your own numbers through the break-even calculator, and see trips per hour for how operators measure it.

The risks that sink NEMT companies

Plan for these pressures before you start.

• Slow money. MTM has 30 days from online submission to pay a clean invoice, and it will not pay a claim that arrives more than 90 days after the trip unless its client sets a different deadline. Georgia’s default for brokers is 15 business days after an undisputed invoice arrives. Either way, you carry payroll and fuel for weeks. See NEMT cash flow.
• One payer. The same MTM contract guarantees no trip volume. Either party can cancel with 30 days’ written notice, and MTM can end the agreement immediately if it loses the contract with its client.
• Closed doors. Under 42 CFR 455.470, a state working with CMS can freeze new enrollments for a provider type it considers a fraud risk. Broker networks in your county can also be full. See NEMT broker network full.
• Audits. In May 2026, HHS’s inspector general announced audits of whether selected states paid NEMT claims correctly, with the series due to wrap up in fiscal year 2028. Honest companies still need a trip record behind every claim. See NEMT documentation requirements.
• Fewer members. States that cover the adult expansion group must start a Medicaid work and community engagement requirement by January 1, 2027. By CMS’s projection, enrollment drops by about 2.3 million in fiscal 2027 and by 3.1 million to 3.3 million in each year after that.

Who this business fits

The pressures above point to the owners who handle NEMT best.

• The owner who drives first. Keeping the first van’s wage in the business buys time to build a trip base, and it teaches you every rider, facility, and dispatcher by name.
• The operator with a specialty. Wheelchair and stretcher rates run well above sedan rates, and the work needs equipment and training a sedan operator lacks. Sedan work competes with taxis, which carried riders on about a third of Medicaid ride days in 2021, by CMS’s count. Our wheelchair van startup guide walks through the extra steps.
• The existing transportation company. A taxi, livery, or paratransit operator already has vehicles, insurance, drivers, and a dispatcher. Adding Medicaid work is a smaller step. See adding NEMT to a taxi business.
• The organized biller. Owners who close out trips daily, bill weekly, and fix rejected trips fast get paid sooner and are ready when an auditor asks for records.

The business fits poorly for anyone who wants passive income, has no cash for the first months, or plans to depend on a single broker.

A self-check before you buy a van

Answer each one honestly. Every “no” is work to do before you spend on a vehicle.

1. I know whether my state pays rides through the state, brokers, health plans, or a mix. See how states run NEMT.
2. I have the actual rate sheet for at least two payers, in writing.
3. At least one broker has told me its network is open for my county and service level.
4. I have counted the dialysis centers, senior communities, and day programs within my service area. See NEMT market research.
5. I have a real insurance quote at the limits my payers require.
6. I have cash for roughly two months of wages, fuel, and premiums while the first payments are in transit.
7. I know my cost per van-hour and the trips per hour I need to break even.
8. I have a payer lined up beyond Medicaid, such as a facility contract or private-pay riders. See private pay NEMT.
9. I or someone I trust can dispatch, bill, and keep trip records every day.
10. I am willing to drive the first van myself if the numbers call for it.

When the list checks out, work through our guide on how to start a NEMT business.

Keeping score from the first week

Two numbers decide this business: trips per van-hour and what each payer still owes you. HealthRide’s payer summary shows completed trips, revenue billed, and the balance still owed for every payer, and the driver activity report tracks hours, with no report builder to set up. Ryder Go builds the whole day’s schedule in one click, so the same vans fit more trips with fewer empty miles. See reports and Ryder Go.